Asian markets rise on Greek debt hopes
HONG KONG—Asian markets rose Wednesday, tracking gains on Wall Street amid growing hopes that Greece will reach a bailout deal with creditors on its massive debt, and avoid a much-feared default.
The euro also got a boost after reports that a final debt rescheduling deal had been drafted and may be signed as a general strike gripped the nation, with demonstrators protesting against unpopular wage and pension cuts.
Sydney was up 0.40 percent, or 16.5 points, at 4,290.7, Tokyo gained 1.10 percent, or 98.07 points, at 9,015.59, while Seoul jumped 1.12 percent, or 22.14 points, to 2,003.73 – the KOSPI index’s highest close in six months.
Hong Kong also ended at a half-year high, up 1.54 percent, or 319.27 points, at 21,018.46. Shanghai finished 2.43 percent higher, or 55.63 points, at 2,347.53.
Athens is treading water over an agreement with private lenders to cut part of its 350-billion-euro ($460-billion) debt, with big loan repayments due next month raising fears it will not be able to pay its bills.
The impasse sparked a terse rebuke from French President Nicolas Sarkozy and German Chancellor Angela Merkel, who said it was time for Greece to take action on its fiscal problems.
On Tuesday, European Commission head Jose Manuel Barroso was quick to insist that Athens would stick with the euro, amid fears of a fiscal implosion with the nation tumbling out of the currency bloc.
“We want Greece in the euro,” Barroso said. “The cost of a Greek exit from the eurozone would be higher than the cost of continuing to support Greece.”
He added that Athens was “very close” to a debt rescue deal, which includes a new bail-out and banks taking losses on their bond holdings.
“We expect tight ranges to continue, possibly until we get a definitive solution from Greece,” IG Markets chief market analyst Stan Shamu in Melbourne told Dow Jones Newswires.
Russell Jones, a strategist at Westpac in Sydney, added that: “Whatever Greece signs up to this week, the European sovereign crisis is far from over. Further rounds of market turbulence are to be expected.”
Asian markets took a lead from Wall Street, which ended higher on Tuesday on hopes for action on the eurozone’s debt crisis and growing optimism that a stronger US job market signalled a recovery for the world’s number one economy.
The Dow Jones Industrial Average rose 0.26 percent, the broad-based S&P 500 added 0.20 percent while the tech-heavy Nasdaq Composite was flat.
Still, traders also kept an eye on Federal Reserve chairman Ben Bernanke, who in testimony to the Senate Budget Committee reiterated his concerns about high levels of US unemployment just days after a surprisingly large drop in the jobless rate.
Investors cheered better-than-expected earnings from Coca-Cola and fast-food giant Yum! Brands, owner of the KFC and Pizza Hut chains.
In Tokyo, government data showed Japan’s current account surplus tumbled to a 15-year low in 2011 as the nation logged a trade deficit due to lower exports and higher energy costs.
Anglo-Australian miner Rio Tinto, meanwhile, said it would pump a further $3.4 billion into expanding iron ore operations in the Pilbara region of Western Australia to meet strong demand from Asia.
Also Wednesday, global mining giant BHP Billiton posted a 5.5 percent fall in first-half profit to $9.94 billion, largely due to volatility in commodity prices, which it expects to persist.
European markets rose in early trade, with London’s FTSE 100 index gaining 0.38 percent, Frankfurt’s DAX 30 adding 0.69 percent and the Paris CAC 40 up 0.41 percent.
The euro fetched $1.3260 and 102.20 yen, against $1.3261 and 101.82 yen in New York late Tuesday.
The dollar edged up to 77.07 yen from 76.78 yen in New York.
New York’s main oil contract, West Texas Intermediate (WTI) light sweet crude for delivery in March, gained 64 cents to $99.54 a barrel and Brent North Sea crude for March delivery was up 42 cents to $116.46.
Gold was at $1,744.90 an ounce at 1015 GMT, against $1,749.34 late Tuesday.
In other markets:
— Taiwan shares rose 2.11 percent, or 162.47 points, at 7,869.91.
Hon Hai Precision was 4.32 percent higher at Tw$101.5 while smartphone maker HTC was 7.0 percent limit-up at Tw$548.0.
— Singapore closed up 0.83 percent, or 24.42 points, to 2,982.20.
Beverage distributor Fraser and Neave shed 0.75 percent to Sg$6.59 while United Overseas Bank gained 0.51 percent to Sg$17.62.
— Manila rose 1.08 percent, or 49.82 points, to 4,805.80.
SM Prime Holdings was up 4.7 percent at 15.60 pesos and Manila Water added 2.6 percent to 22.05 pesos.
— Bangkok advanced 1.36 percent, or 14.96 points, to 1,116.08.
PTT gained 2.05 percent to 348 baht, while Banpu added 0.97 percent to 626 baht.
— Indonesian shares rose 0.8 percent, or 33.25 points, to close at 3,988.70.
Bank Rakyat Indonesia jumped 4.4 percent to 7,150 rupiah, while the world’s largest tin miner Timah gained 4.2 percent to 1,980 rupiah.
— Kuala Lumpur closed up 0.94 percent, or 14.41 points, at 1,553.18.
Plantations giant Sime Darby rose 2.3 percent to 9.68 ringgit while Public Bank climbed 1.5 percent to 13.96 as gaming giant Genting Malaysia slid 5.0 percent to 3.81 ringgit.
— Wellington gained 0.29 percent, or 9.52 points, to 3,324.67.
Hallenstein added 2.25 percent to NZ$3.63 while Fletcher Building was 1.1 percent higher at NZ$6.61 and Telecom rose 0.23 percent to NZ$2.15.
— Mumbai stocks rose 84.87 points or 0.48 percent to 17,707.32.
India’s largest private aluminium producer Hindalco climbed 4.92 percent to 160.85 rupees while the world’s largest miner Coal India jumped 2.29 percent to 332.8.
Top mobile phone firm Bharti Airtel slid 6.58 percent to 354 rupees after it reported a bigger-than-expected 22 percent plunge in quarterly profit from a year ago, hit by debt charges and 3G network rollout costs.
